From Newark, NJ
I woke this morning to find another “asset” has broken the psychological 100 barrier – The Yen!
Yahoo Finance Story Here
If you remember, a couple of weeks back I wrote a quick entry when oil broke over 100 dollars per barrel (playing with $110 right now). Now we have the Yen, breaking 100 in the other direction. In currency markets, the Yen traded as ‘high’ as 99.75Y per US dollar below settling above 100Y for the day.
Do you remember when the Yen/dollar ratio was 140 or higher? That meant that if you had gone to Japan (where I may be visiting soon to research real estate for clients) you would have converted each US dollar into 140 Yen. So in an example, if a can of soda costs $1 here and 140Y in Japan, you could go to Japan, convert your currency, and buy that can of soda for the same cost. Now that the dollar is worth so much less (around 100), your $1 would get you 100Y and you would need 40 more to get the soda. Therefore, it would cost you about $1.40 for that soda now. Let me just say that large moves like this in currency are not good for global trade and stability – more pain is coming.
By the way, and speaking of real estate research, I am in New York this morning visiting with the management of Lightstone Real Estate. I will be reviewing their process and strategy along with visiting one of their properties in Times Square. Lightstone is run by David Lichtenstein, whom you can see in the video link from this recent posting HERE.
March 13, 2008
By the way, out of full disclosure interests, clients of my advisory firm currently own Japanese Yen through an exchange traded vehicle. In no way does this article represent a recommendation to you to invest in Yen. Talk to your own advisor about whether this makes sense for you, or not. Basically, don’t be stupid ok? 🙂